Iran Oil Sales May Outstrip Sanctions Cap for Fifth Month

March 27, 2014

A technician works as a helicopter lands at an Iranian oil platform in the Persian Gulf in 2004. Iran appears poised for a fifth month to sell more oil than the average it is permitted to export under an interim nuclear deal with six world powers, according to observers.
(Behrouz Mehri/AFP/Getty Images)

Iran appears poised for a fifth month to sell more oil than the average it is permitted to export under a short-term nuclear deal, Reuters reports.

An industry observer said Iran has sent out oil at an overall pace of 1.3 million barrels a day this month, the news agency said on Wednesday. However, the nation agreed not to average more than 1 million barrels in sales each day for the six-month duration of the atomic accord that took effect on Jan. 20.

The limits are intended to help pressure Tehran to accept restrictions on its nuclear program, which Washington and other Western capitals consider a potential vehicle for achieving a nuclear-weapons capability.

Obama administration officials expect Iran to cut its petroleum sales in coming months to bring its average exports down to the cap it accepted in November, according to Reuters.

Still, advocates of stringent economic penalties said Iran's burgeoning oil sales show that the interim accord has loosened financial restrictions on the country more than negotiators intended. Tehran insists its nuclear program is peaceful, but agreed to limit the atomic effort in return for sanctions curbs under the agreement with China, France, Germany, Russia, the United Kingdom and the United States.

"Iran will have to reduce exports by over 40 percent over the next three months in order not to exceed the average of last year," said Tim Wilson, an analyst with the pro-sanctions Foundation for Defense of Democracies. Tehran sold an average of 1.1 million barrels of oil each day in 2013.

Meanwhile, a high-level Iranian government insider said his nation intends to boost its purchases of gasoline within the next 12 months, Reuters reported in a different article. U.S. economic penalties have separately targeted Iran's ability to obtain gas from abroad.

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Iran is currently negotiating a nuclear agreement in Vienna with representatives of the so-called E3/EU+3. A major feature of any agreement will be the limits it places on the number and type of centrifuges that Iran is allowed to use. Visualize the numbers with and without a comprehensive agreement.

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